Eating dinner with Larry Augustin in London this weekend, we fell to talking about open source's relevance to the SMB (small- and medium-sized business) market. Augustin is currently CEO of SugarCRM, a company with over 5,000 customers, many of them SMBs.

Why aren't more SMBs adopting open source? Following recent Forrester data, Savio Rodrigues of IBM points out that many SMBs still cling to the perception that open source is not secure and is overly complex.

In many cases, it's not perception. While it's tough to generalize about open source at this point in its history, it's absolutely the case that some open source is complex, some open source is not secure, etc. Much open-source software mimics the enterprise software world it strives to leave behind.

While some big vendors like Cisco already have significant SMB focus, others, like Oracle, SAP, etc., could use an open-source runway to the SMB market. Unfortunately, as noted, open-source vendors haven't necessarily penetrated the SMB market any better than the proprietary vendors have.

This suggests a strategy for open-source vendors, one that could lead to a big exit: figure out how to pitch to the SMB market, then sell to those big, proprietary vendors that need an entree to SMBs. The new hybrid model for open-source vendors might well be to make the "enterprise" version the one that is easiest to administer and use.

First, however, open-source vendors need to start making software easier to use, and not emulate all the wrong behaviors of the proprietary past. Fortunately, the way to make software easier for SMBs and to monetize it might actually be cloud-based computing.

About the author

Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company. Matt brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. He is a member of the CNET Blog Network and is not an employee of CNET. You can follow Matt on Twitter @mjasay.
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